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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: long-gone who wrote (38940)	8/13/1999 8:28:00 AM
From: Rarebird	Read Replies (3) \| Respond to of 116927

NEW YORK, Aug 12 (Reuters) - Investment bank Goldman Sachs and Co. said on Thursday that its recent stockpiling of gold through the New York gold futures exchange did not reflect any unusual activity for the firm. "Goldman Sachs is one of the largest and most active participants in the market and this is all within the normal course of business," a spokeswoman for the firm told Reuters. "We are seeing very strong demand for physical metal." According to figures available to the public from the COMEX, a division of the New York Mercantile Exchange (NYMEX), the firm has apparently amassed about 15 tonnes of gold in August, owning half the gold stocks in exchange warehouses, while the troubled gold market gossips about the ramifications. Goldman, which trades through its commodities arm J. Aron and Co., has so far this month committed to take about 95 percent of the metal offered by other players for physical delivery against short futures positions. Of the 4,955 100-ounce COMEX contracts to be delivered as of August 12, the investment bank will receive gold from 4,735 contracts. This amounts to 473,500 troy ounces of bullion -- 14.7 metric tonnes -- or about 50 percent of the 948,973 ounces now held in COMEX warehouses. "That is what you call accumulation," said Don Tierney, of Pell Brothers Trading. "That has obviously helped the market up and also put the strength in the nearby (futures contracts)," he said. "They have taken a long position and they now own half of the gold in the COMEX bank. This isn't short covering." Bearishness about gold prices has dissipated somewhat in recent days. On Thursday gold prices reached their highest levels since July 6, when an auction of 25 tonnes of gold from the Bank of England's reserves sent gold prices down to 20 years lows. Bullion prices bottomed at $252.20 per ounce on July 20, their lowest level since mid May 1979, but since then short covering by speculators, and talk about Goldman's purchases has helped prices recover. The December COMEX gold futures contract bottomed at $255.60 on on July 21. December gold ended at $263.00 an ounce on Thursday, up $1.50. "These scares about delivery versus warehouse stocks very rarely amount to anything because it's not that difficult to replace them, I'm talking about all commodities," said John Brimelow, a mining equity analyst at Donald and Co. "As far as a literal shortage of metal in the world, I don't think it's terribly significant," he said, adding "It may be a sign, in that Goldman suddenly started making bullish noises about a week ago."